I would be worried that private lenders would swoop in to recklessly issue subprime loans creating another debt crisis. Ideally if someone was crunching the data education loans would be based on expected median salary of people holding the conferred degree (this would anger a lot of folks who wish to pursue degrees in less than lucrative areas like education).
It might also help balance fields like education. Either those jobs would have to pay more, or the curriculum may have to change where it is not as expensive. Less supply of people in those fields should equal more $$$.
Maybe I'm not smart enough to understand the debt crisis. I was of the mind, let the banks fail, let GM fail... hell with it. I got stuck with a shit loan (although not underwater anymore, thankfully). Banks got bailed out, fuck them, where is my bail out? I could have walked away and said fuck it, maybe I should have. My car was too nice for cash for clunkers, how did that help me? That whole mess of government spending was shit imo.
Sorry tangent rant, I guess my point is, if we don't bail them out, maybe they will be smart about who they loan to.
I predict that if loans for education were difficult to obtain. The cost of education would decline.